New Delhi: Chinese smartphone makers Oppo and Vivo plan to move their cloud service locations to India, while an up and coming brand from the Asian country has called off talks with developers of apps to be pre-loaded on its devices after the Indian government asked handset companies to share their customer data security protocols.

According to senior industry executives, some domestic device vendors are also seeking clarity from pre-loaded app developers about security features to protect user data after the IT ministry recently ordered almost 30 smartphone makers – mostly Chinese – to share their information security protocols by August 28.

“Oppo and Vivo have their cloud outside India, which is usually outsourced to enterprise cloud service and data server providers like Amazon. They are now asking them to change the location of these clouds to Indian territory,” said a senior executive, asking not to be identified.

Amazon Web Services and Microsoft Azure are the leading cloud and server providers and both have a presence in India. The companies did not respond to queries about whether Chinese, multinational or Indian handset makers had discussed shifting of their remote data-storage locations.

Vivo and Oppo, which are No. 3 and No. 4 in India by market share, declined to comment.

A relatively new Chinese entrant, which has soared up the handset market ranks, has halted talks with app developers after getting the government order. Its CEO said that while the company’s servers and cloud storage were local, it wants to ensure compliance with any upcoming government rules before entering into agreements with app developers. Pre-loading apps on a device would give the handset maker additional revenue, he added.

A leading Indian handset brand with servers in the country has asked developers of apps that were being pre-bundled on some of its devices to share their user information protection protocols.

“We have asked them internally, so we can tell the government,” a senior executive of the company said, asking not to be identified.Cyber security experts said that moving cloud services to India would only be the first step that companies would have to take considering that the government’s long-term view is to keep data of mobile phone users within the country.

“If companies are moving their cloud-based data to India, it’s fine as that is the first level where data is stored and it can be easily accomplished. But the more important aspect to address is whether data would leave India at any point for processing, analytics, etc.,” said Amit Jaju, partner, cyber forensics and data analytics, at EY. “The regulations need to be clearer in defining this.”Moving cloud locations would take one to two weeks and the cost would not be very high.

“However, if to move the cloud to India a brand has to change its service provider from one which doesn’t have an India-ready model to one which has, that transition can become effort- and cost-oriented,” said Atul Gupta, partner of IT advisory at KPMG India.

EY’s Jaju said large mobile companies, including Chinese handset makers, will increasingly have to keep their data storage locations within the countries where they operate as rules to protect user privacy globally, including India, become stronger.

In the European Union, fines of up to 20 million euros or 4% of revenue of a data controller can be levied for any violation, including security breaches. The proposed rules – under which personal data of EU users needs to remain in the Union – come into effect in May 2018.

India has directed 30 handset makers including Apple, Samsung, Micromax, Xiaomi and Lenovo to share the procedures and processes they use to ensure the security of mobile phones sold in the country by August 28.

“We comply with all regulations of the Indian government,” a Samsung spokesperson said. Indian companies including Micromax have made similar statements.

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